Tesla, the automobile company started by uber-entrepreneur Elon Musk, is valued by stock markets at $30 billion. That is a pretty sizable valuation for a company that sold 24,000 cars in 2013. General Motors, by comparison, is valued at roughly $56 billion on sales of 9.7 million cars. How can we explain such a discrepancy? Clearly, Tesla benefits from very good press, and very “sexy” product. But a big part of the answer may also lie in the fact that when markets look at the disruptive potential of Tesla electric vehicles, they don’t see it as a threat to GM’s business model. They see it – and its potential to be a medium-term substitute for oil in the transportation sector – as more of a disruptive threat to the business model of Exxon (market capitalization of $410 billion) and the other majors.

That kind of disruption, and the challenges and opportunities it represents, lies at the heart of a new report from the Global Commission on the Economy and Climate: “Better Growth, Better Climate” delivered by Felipe Calderon and Lord Nicholas Stern in advance of last week’s United Nations Climate Summit. Based on new analysis showing the gains that have been realized globally in investments in low-carbon efficiency, infrastructure, and innovation, the basic message delivered by the Commission is that fighting climate change will not hurt the economy.

For Canada, the report asks some tough questions about whether “business as usual” is a viable economic strategy for the country.

Right now, Canada’s policymakers are banking on resource driven economic growth underpinned by the export of energy from the oil sands. This makes a certain sense given what we know of how much demand exists for fossil fuels. After all, there is a reason that Exxon is valued at $410 billion. But in the global energy mix, Canada’s oil sands are expensive and carbon intensive, making them vulnerable to price structure changes and measures to combat climate change – both of which are probable developments over the next 10 years.

Canada’s current policy choices would make more sense if the rest of the world was standing still, but it’s not. As the Better Growth, Better Climate report shows, dynamic and highly competitive change is happening fast in countries like China and the United States. Canada needs a significant course correction if it wants to be part of the global economic transition mapped out in the report. A “business as usual” approach could see Canada slip further behind competitor nations, many of which are already well-advanced in the technology innovations needed to ensure prosperity for their people in a world where carbon will not fuel future growth.

The good news is that Canada already enjoys many of the elements necessary to building that prosperity. A well-educated and enterprising population, stable and resilient markets, strong governance and regulatory structures are all considerable advantages and should not be taken for granted. And provincial governments have already taken significant steps – from British Columbia’s carbon tax to Ontario’s closure of its coal power plants to decarbonize their economies. But the truth is that when it comes to the most important markers of future low carbon prosperity – from energy efficiency, to clean tech, to renewable energy – Canada underperforms. And that is because of a lack of any kind of overall strategy or commitment to that future, and to making the policy choices to make it real. Well-designed government policy can make growth and climate objectives mutually reinforcing in the short and medium term. Without such policy, Canada won’t be making and selling the low-carbon goods and services of the future… but will be buying them from others.

Canada can prosper in the new climate economy. What to focus on is clear: raising resource efficiency, investment in low-carbon forms of infrastructure, and stimulating innovation in technologies. What’s needed is strong political leadership and credible, consistent policies.

—

The Global Commission on the Economy and Climate, headed by former Mexican President Felipe Calderón, was set up to examine whether it is possible to achieve lasting economic growth while also tackling the risks of climate change. Its purpose is to help governments, businesses and society make better-informed decisions on climate and the economy. www.newclimateeconomy.net

Jeremy Oppenheim is the Global Programme Director of the New Climate Economy Project. Alex Wood is Senior Director, Policy and Markets at Sustainable Prosperity, a national research and policy network based at the University of Ottawa and focused on market-based approaches to build a greener economy.

Really? The “scientific method” keeps science from saying their own 32 year old; “THREAT TO THE PLANET” is “proven” or “100% certain”? Prove it. What scientist has ever said that about a “possible” CO2 climate crisis?
Liberal exaggeration and fear mongering just to hissy fit hate neocons makes libs the new “neocons”.
32 years of needless CO2 panic is a war crime!

If we haven’t set the world on a course toward total polar meltdown, just with the CO₂ we’ve already emitted, why isn’t there a single previous example in Earth’s history of polar ice caps withstanding CO₂ so high?